Volume 16, Number 4 Article by R K Singh & Suresh Garg & S G Deshmukh December, 2004
Competitiveness of Small and Medium Enterprises:Case of an Indian Auto Component Manufacturing Organisation :
Indian small and medium enterprises,especially those in the auto component sector,have long operated in a protected environment and concentrated on the domestic market.Liberalisation saw foreign automobile firms and auto component makers entering the Indian market,and with their entry,the rules of the game have changed.Historically,vendors have worked in a build-to-print mode with domestic manufacturers but global automakers now pass on responsibilities of research,design,development, testing,validation,and integration to vendors.They no longer want mere manufacturers;they want full service suppliers in addition to lower cost.
How has the Indian auto sector risen to face these new challenges?How competitive are Indian auto component firms?R K Singh,Suresh Garg and S G Deshmukh have developed a model to assess competitiveness,taking into consideration assets, pressures,constraints,strategies,competitive priorities,processes and performance of an organisation.The framework has been illustrated through the case study of a leading auto component manufacturer,XYZ.
The study reveals that the Indian auto component sector is investing in R&D,automation and IT applications to improve its competitiveness in the domestic and global markets.The sector is focusing on improving its assets,processes and strategies in addition to tangible and intangible performance measures.XYZ is implementing strategies such as Enterprise Management Systems,quality systems and R&D facilities,automation of processes,IT applications,training and welfare of employees,cost reduction and product design.XYZ also does regular environmental scanning by using SWOT analysis.The main competitive priorities are:quality,cost,delivery reliability,vendor development,labour productivity, aggressive marketing and better technology and design.
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